MADISON, Wis.-Look for credit unions to herd members online in 2010 to newly enhanced virtual branches-online hubs that save money for the CU and meet an increasing number of members' service needs.
That's a primary finding of Credit Union Journal's exclusive "Look Ahead" roundtable with the CUNA Technology Council Executive Committee.
"The call of the day is how IT can drive cost reduction," said Rudy Pereira, Executive Committee chair and SVP-operations and technology at $6.8-billion Alliant CU in Chicago. "So many credit unions are looking to close branches, which will result in further innovations to online banking."
Some relevant online banking technologies to explore or upgrade in 2010 are remote deposit capture, person-to-person (P2P) payment, personal financial management (PFM), ACH-transfer and secure forms, members of the Council suggested.
"Electronic services increase member profitability," because of lower costs per transaction, added Robert Reh, Executive Committee second vice chair and CIO at $333-million Nassau Financial FCU in Westbury, NY.
Indeed, Sandia Laboratory FCU believes that remote deposit services are so cost-efficient that SLFCU plans on handing out home deposit scanners to members for free next year, specifically so that members will be less inclined to make their deposits at expensive shared branches, according to Jennifer Weiss, Executive Committee member and VP-IT at the $1.4-billion CU in Albuquerque, N.M.
How else can CUs get members to embrace the CU online? "More targeted marketing toward online banking," Weiss suggested, along with making services easier to use, such as using bill presentment capabilities to automatically populate the correct payment amount when a member goes to pay a bill using electronic bill pay.
Get members online by getting employees geared up about your online offerings, urged Belinda Caillouet, executive committee member and VP-IT at $1.3-billion Spokane Teachers CU (STCU) in Liberty Lake, Wash. "We're trying to build excitement with employees so that they'll talk to members about online services and even provide them with technical support." STCU allows certain employees to beta test and train on new products so that they can act as mentors for other employees and members.
As the virtual branch becomes more popular, small credit unions in particular may find that current log-in security isn't strong enough, added the Committee. "We'll need to examine what the next generation of verification will look like because the current multi-factor authentication approach is not as good as it needs to be," Weiss said. "Instead, I think we need more biometrics and one-time passcodes delivered to mobile phones."
